Jushi Holdings announces option re-pricing program

Jushi Holdings announced that an independent committee of its board of directors has approved an option re-pricing program with respect to certain options issued to seven senior management employees and three independent directors under the Company’s 2019 Equity Incentive Plan. The board of directors of the Company recognizes that the current trading price of the subordinate voting shares of the Company is significantly lower than the exercise price of the Subject Options, and as such, the Subject Options are considerably “out of the money”. To comply with the policies of the Canadian Securities Exchange and applicable Canadian and US securities laws, Jushi has implemented a one-time offer that permits Eligible Participants that hold options under the Option Plan with exercise prices that range between US$3.91 and US$4.71 to have those options cancelled and reissued on a future date at an exercise price based on the current trading price of the Shares on the Option Re-Issuance Date and otherwise in accordance with the Option Plan. A total of 3,224,000 Subject Options are part of the Program. James Cacioppo, the CEO of the Company, is not eligible to participate in the Program. Participation in the Program is voluntary. Eligible Participants that participate in the Program will have all of their Subject Options cancelled on November 17, 2023, and then will have the same number of options re-issued under the Option Plan on the Option Re-Issuance Date at the Re-Issuance Exercise Price. The expiry date will be ten years from the Option Re-Issuance Date and the vesting of the Replacement Options held by the officers and directors will be reset. The Subject Options of Eligible Participants that choose not to participate in the Program will remain outstanding pursuant to their current terms, including the current exercise price, expiry date and vesting schedule. The Company also announces that, in order to assist the Company in managing the share reserve under the Plan and to also assist the Company in managing cash and near-term working capital requirements, the Company and Mr. Cacioppo have agreed to certain amendments to Mr. Cacioppo’s employment agreement. All of the Employment Agreement Amendments were approved on behalf of the Company by the independent directors of the Company. Pursuant to the Employment Agreement Amendments, Mr. Cacioppo, has agreed to: cancel 3,000,000 Options that were granted to him on October 27, 2021; waive his annual salary increase of US$100,000 for 2024; and waive his annual bonus entitlement of US$850,000 for the measurement period 2023. In consideration of the foregoing cancellations and waivers, Mr. Cacioppo will receive the following: a lump sum cash payment in the amount of US$212,500; US$1,150,000 aggregate principal amount of 12% second lien notes on the same terms as the notes that were issued by the Company in its private placement that was completed in December 2022; and Warrants to purchase up to approximately US$575,000 worth of the Shares at an exercise price per Share equal to the greater of: a 25% premium to the volume-weighted average price per Share of the Shares on the CSE over the trailing 10 trading day period prior to the date the Warrants are granted, and the Fair Market Value of the Shares on the CSE on the date the Warrants are granted, but otherwise on the same terms as the warrants that were issued by the Company in its private placement that was completed in December 2022.